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Vijay Kumar Arya and ors. Vs. the Board of Trustees for Time Being for the Kolkata Port Trust and ors. - Court Judgment

SooperKanoon Citation
SubjectTenancy;Property
CourtKolkata High Court
Decided On
Case NumberW.P. No. 932(W) of 2007
Judge
Reported in(2008)1CALLT410(HC)
ActsPublic Premises (Eviction of Unauthorised Occupants) Act, 1971 - Sections 2, 4, 4(1), 4(2), 5 and 8; ;Transfer of Property Act, 1882 - Sections 106 and 111; ;Government Grants Act - Section 3; ;Tamilnadu Public Premises (Eviction of Unauthorised Occupants) Act, 1975; ;Code of Civil Procedure (CPC) , 1908; ;Constitution of India - Articles 12 and 14; ;Public Premises (Eviction of Unauthorised Occupants) Rules
AppellantVijay Kumar Arya and ors.
RespondentThe Board of Trustees for Time Being for the Kolkata Port Trust and ors.
Appellant AdvocateP.S. Deb Barman and ;R.P. Matilal, Advs.
Respondent AdvocateSubir Sanyal and ;Somnath Bose, Advs.
Cases ReferredUnion of India v. K.P. Joseph
Excerpt:
- dipankar datta, j.1. challenge in this petition is to a notice dated 28.7.06 issued by the land manager (in-charge) of the kolkata port trust. by the said notice, it has been conveyed to the petitioners, the lessees, that they have wrongfully parted with possession of leasehold land by inducting a number of sub-tenants without the prior approval in writing of the port trust, the lessor, and this constitutes a major breach of the terms of the lease and, therefore, the petitioners were called upon to quit, vacate and deliver up vacant and peaceful possession of the same on 1.2.07 it was further conveyed thereby that the petitioners' relationship with the board of trustees for the port of calcutta would stand determined on and from 1.2.07 and that the board of trustees has no.....
Judgment:

Dipankar Datta, J.

1. Challenge in this petition is to a notice dated 28.7.06 issued by the Land Manager (In-Charge) of the Kolkata Port Trust. By the said notice, it has been conveyed to the petitioners, the lessees, that they have wrongfully parted with possession of leasehold land by inducting a number of sub-tenants without the prior approval in writing of the Port Trust, the lessor, and this constitutes a major breach of the terms of the lease and, therefore, the petitioners were called upon to quit, vacate and deliver up vacant and peaceful possession of the same on 1.2.07 it was further conveyed thereby that the petitioners' relationship with the Board of Trustees for the Port of Calcutta would stand determined on and from 1.2.07 and that the Board of Trustees has no intention/desire to revive the relationship. It was also conveyed that in case of default of handing over possession of the leasehold land by the date fixed, the matter would be referred to the Estate Officer under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (hereafter the P.P. Act) seeking an order of eviction.

2. Mr. Deb Burman, learned Counsel for the petitioners has urged that the impugned notice does not contain material particulars of breach committed by the petitioners and the allegations are delightfully vague, indefinite and unspecific. The impugned notice is further called in question on the ground that the Port Trust, being an authority within the meaning of Article 12 of the Constitution of India, could not have unilaterally and in an arbitrary manner determine the lease without granting opportunity to the petitioners to disprove the absolutely incorrect and baseless allegations contained in it, for, according to him, sub-tenants were inducted by the petitioners after obtaining written permission from the Port Trust. The Port Trust having acted in clear breach of principles of natural justice as well as acted in an arbitrary and high-handed manner which is violative of Article 14 of the Constitution, the petitioners have prayed for setting aside of the impugned notice with a direction upon the Port Trust to hear the petitioners and, thereafter, to pass an appropriate order in accordance with law.

Mr. Deb Barman in support of his submissions placed reliance on the following decisions:

: Rajesh Kumar v. Deputy CIT;

: Jamshed Hormusji Wadia v. Board of Trustees, Port of Mumbai and Anr.;

: Dwarkadas Marfatia & Sons. v. Board of Trustees, Port of Bombay; and

1992 (2) CLJ 9 : Lee and Muihead (I) Pvt. Ltd. v. The Board of Trustees for the Port of Calcutta and Ors.

3. Mr. Sanyal, learned Counsel for the Port Trust vehemently opposed the writ petition. According to him, the writ petition is not at all maintainable since it is an inchoate/premature application. He contended that there is no question of the Port Trust giving any opportunity of hearing to the petitioners prior to issuance of the notice to quit, for, it is not an administrative order but a notice issued in terms of Section 111(g) of the Transfer of Property Act (hereafter the T.P. Act). He further contended that the Port Trust had issued the notice to quit only after it was convinced that the petitioners have breached the terms of the lease and to buttress his contention he placed relevant documents annexed to the counter affidavit filed by the Port Trust. According to him, if the petitioners intend to dispute the conclusions recorded by the Land Manager in the impugned notice, they would have the opportunity of raising effective defence once a proceeding under the P.P. Act is initiated by issuance of a notice under Section 4 thereof, for, the ground for seeking eviction would be breach of the terms of the lease deed and not that the authority to remain in occupation has been determined. It is his contention that the question as to whether a party is in unauthorized occupation of a public premises or not would, necessarily involve a determination as to whether the petitioners have; in fact, breached the terms of the lease deed or not and only on recording a satisfaction that there has, in fact, been a breach of the terms of the lease deed that the Estate Officer would be justified in ordering eviction. He invited the attention of this Court to the various provisions of the P.P. Act and submitted that before making an order for eviction, the Estate Officer appointed thereunder has to record his satisfaction that ground exists for ordering eviction and, in the process, while the Estate Officer proceeds to determine the issue involved, he may compel attendance of any person for examining him on oath or require discovery and production of documents, and the petitioners would be well within their rights to dispute the material allegations contained in the impugned notice and to prove that there has been no breach of the terms of lease at their instance. He referred to the provisions of Section 111(g) of the T.P. Act to contend that power has been exercised thereunder which does not contemplate giving of prior opportunity of hearing and, therefore, the contention raised by the petitioners in this respect is absolutely misconceived.

4. He further urged that in any event the point as to whether the petitioners are entitled to be heard prior to issuance of the notice to quit does not require any decision from this Court in the absence of any case having been made out by the petitioners in this behalf in the writ petition. He invited the attention of this Court to Ground No. IV of the petition to contend that on their own showing, the petitioners' case is that without any order being passed by the Estate Officer under the P.P. Act they cannot be evicted.

5. He relied on the decisions reported in 1994 Supp (3) SCC 694: Jiwan Dass v. Life Insurance Corporation of India and Anr. : Ashoka Marketing Ltd. v. Sahu Jain Services Ltd. and 1996 (1) CHN 407: Life Insurance Corporation of India v. Harmony House to contend that there was no merit in the contentions advanced on behalf of the petitioners and the writ petition is liable to be dismissed.

6. In course of hearing, Mr. Sanyal, learned Counsel was called upon by the Court to advance submission on the decision of the Apex Court reported in : Anamallai Club v. Government of Tamil Nadu and Ors. He submitted that the said decision would have no application in the facts and circumstances of the present case since in that case a licence granted under the Government Grants Act (hereafter the G.G. Act) was revoked and thereunder, the Government had the power to resume any land which had been granted in favour of a particular party upon determination of the licence without taking recourse to the P.P. Act. He also submitted that the G.G. Act and the T.P. Act operate in different fields and, therefore, the decision is clearly distinguishable. Having heard learned Counsel for the parties and considering the facts and circumstances of this case, the principal issues that arise for determination are:

(1) Whether the Estate Officer appointed under the P.P. Act has the necessary authority and competence to determine the issue of legality, validity and/or propriety of the notice to quit issued by the Port Trust or not?

(2) If the first issue is answered in the negative, whether the Port Trust was under any obligation to act fairly and reasonably consistent with Article 14 of the Constitution prior to determining the lease, and whether any case of infringement of right guaranteed by it been made out in the petition?

(3) To what relief, if at all, the petitioners are entitled to on facts and in the circumstances?

Issue No. 1

7. It would be profitable to take note of the relevant provisions of the P.P. Act. The same are extracted hereunder:

2. Definition

(g) 'unauthorised occupation', in relation to any public premises, means the occupation by any person of the public premises without authority for such occupation, and includes the continuance in occupation by any person of the public premises after the authority (whether by way of grant or any other mode of transfer) under which he was allowed to occupy the premises has expired or has been determined for any reason whatsoever. 4. Issue of notice to show cause against order of eviction.

(1) If the estate officer is of opinion that any persons are in unauthorised occupation of any public premises and that they should be evicted, the estate officer shall issue in the manner hereinafter provided a notice in writing calling upon all persons concerned to show cause why an order of eviction should not be made.

(2) The notice shall-

(a) specify the grounds on which the order of eviction is proposed to be made; and

(b) require all persons concerned, that is to say, all persons who are, or may be, in occupation of, or claim interest in, the public premises,-

(i) to show cause, if any, against the proposed order on or before such date as is specified in the notice, being a date not earlier than seven days from the date of issue thereof; and

(ii) to appear before the estate officer on the date specified in the notice along with the evidence which they intend to produce in support of the cause shown, and also for personal hearing, if such hearing is desired.

(3) ***********

5. Eviction of unauthorised occupants.-

(1) If, after considering the cause, if any, shown by any person in pursuance of a notice under Section 4 and any evidence produced by him in support of the same and after personal hearing, if any, given under Clause (b) of Sub-section (2) of Section 4, the estate officer is satisfied that the public premises are in unauthorised occupation, the estate officer may make an order of eviction, for reasons to be recorded therein, directing that the public premises shall be vacated, on such date as may be specified in the order, by all persons who may be in occupation thereof or any part thereof, and cause a copy of the order to be affixed on the outer door or some other conspicuous part of the public premises.

(2) ***********

8. Power of estate officers.-

An estate officer shall, for the purpose of holding any inquiry under this Act, have the same powers as are vested in a civil Court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely:

(a) summoning and enforcing the attendance of any person and examining him on oath;

(b) requiring the discovery and production of documents;

(c) any other matter which may be prescribed.

The rules framed under the P.P. Act provides the form of notice to be issued (Form 'A') under Sub-section 1 and Clause (b)(ii) of Sub-section 2 of Section 4 thereof which is as under:

To

Shri/Shrimati/Kumari....

Where as I, the undersigned, am of opinion, on the ground specified below that you are unauthorized occupation of the Public Premises mentioned in the Schedule below and that you should be evicted from the said premises:

Grounds

Now, therefore, in pursuance of Sub-section (1) of Section 4 of the Act, I hereby call upon you to show cause on or before the...why such an order of eviction should not be made.

And in pursuance of Clause (b)(ii) of Sub-section (2) of Section 4, I also call upon you to appear before me in person or through a duly authorized representative capable to answer all material questions connected with the matter along with the evidence which you intend to produce in support of the cause shown, on...at...for personal hearing. In case, you fail to appear on the said date and time, the case will be decided ex parte.

Schedule

Date:....

Signature and seal of the

Estate Officer

8. It would appear from the above provisions, insofar as the same are relevant for deciding the lis in the present case, that the Estate Officer on formation of an opinion (obviously tentative) that (i) a person is in occupation of a public premises after the authority under which he was allowed to occupy the same has been determined for any reason whatsoever and that (ii) he should be evicted may issue notice in the manner prescribed (Form 'A') calling upon the person/occupant to show cause why an order of eviction shall not be made [Section 4]. The notice in Form 'A' is required to specify the ground on which order of eviction is proposed to be made. Enquiry contemplated in Section 8 of the P.P. Act appears to be in relation to the exercise of finding out whether any party is in unauthorized occupation of a public premises or not [read: 'is in occupation after determination of authority or not' (Section 2(g))], and not whether the notice to quit, based on whatever reason, is legal, valid and/or proper on facts. Upon consideration of the cause shown and on hearing the witnesses and on appreciation of the evidence that might be adduced, the Estate Officer after recording a satisfaction that a public premises is in unauthorized occupation shall make an order for eviction with reasons directing that such premises shall be vacated by those in occupation thereof [Section 5]. Failure to comply with the order of eviction may entail consequence as specified in the P.P. Act. This Court is unable to accept the contention of Mr. Sanyal on the anvil of its understanding of the aforesaid statutory provisions. The Estate Officer is authorised to exercise jurisdiction under the P.P. Act to find out as to whether a person is in unauthorized occupation or not and further as to whether such unauthorized occupation calls for his eviction or not. This Court has failed to find any provision in the P.P. Act that confers on the Estate Officer any authority to decide as to whether the reason for which the authority by which a party was allowed to occupy a public premises has been determined is legal, valid and/or proper or not. If this is conceded, it would amount to conferring authority on the Estate Officer to sit in appeal over a decision to determine a lease taken by the lessor (owner of the public premises) which manifestly does not appear to be the legislative intent. The P.P. Act is designed to introduce speedy machinery and envisages summann procedure for eviction of persons who are in unauthorized occupation of public premises. If an Estate Officer is called upon to decide as to whether the reason for determining the lease is legal, valid and/ or proper or not, it would have to discharge quasi-judicial functions of a nature which the P.P. Act does not enjoin him to discharge and if the contention of Mr. Sanyal is to be accepted, the very purpose of introducing a summary procedure ensuring speedy eviction of unauthorized occupants would be frustrated. In a case of the present nature the scope of enquiry of the Estate Officer, in the humble view of this Court, is limited to ascertaining as to whether the authority by which a party was entitled to remain in occupation stands determined or not, for whatever reason, and if there is a determination, whether an order of eviction is called for or not; the reasons for determination of the authority or whether such decision was taken by an owner, being an Article 12 authority, consistent with the rights guaranteed by Part III of the Constitution or any other right is beyond the authority of the Estate Officer to look into.

9. An instance may be cited. It is quite common that officers/ employees employed in statutory corporations or public sector undertakings are provided with official accommodation as an incidence of service. It may so happen that consequent to a departmental proceeding the service of the concerned officer or employee is terminated and necessarily with the termination of service, his authority to remain in occupation of the public premises would cease. On termination of service, notice is issued by the employer (the owner of the public premises) asking the officer/employee to quit and deliver vacant possession of the accommodation to the employer. The officer/ employee fails to quit and deliver vacant possession. A proceeding is initiated under the P.P. Act for the purpose of his eviction. If the argument of Mr. Sanyal is to be accepted, the officer/employee would be justified in agitating the point of illegality, invalidity and/or impropriety of the order of termination of service before the Estate Officer and call upon him to pronounce his decision thereon. This instance having been put forth before Mr. Sanyal inviting his submissions, he submitted that this being an extreme case was not permissible, and that cases of unauthorised occupation of public premises despite termination of service of an officer/employee cannot be equated with a case of the present nature where there being a breach of the terms of the lease deed, the lease was determined in accordance with law.

10. This Court has failed to comprehend as to how the present case is significantly different from the instance given above. If in case of determination of lease for any reason whatsoever the occupant of public premises would have the scope to question the action of the lessor to determine the lease before the Estate Officer as submitted by Mr. Sanyal, then in every case where the authority by which one is put in occupation of a public premises is revoked consequent to some other act or proceedings or decision, the occupant by the same reasoning as given by Mr. Sanyal would claim the right to be heard by the Estate Officer and for getting a decision from him regarding the legality, validity and/or propriety of the action or proceedings or decision of revocation of the authority by dint of which he was put in occupation. That would be stretching the provisions of the statute to uncalled for limits. The contention being absurd stands overruled.

11. This Court, therefore, holds that if a party intends to call in question an Article 12 authority's decision to revoke or determine the authority by which he was continuing in occupation of a public premises infringing his fundamental or other rights (even if the action be one in terms of the T.P. Act) on alleged non-existent grounds, such question can never be raised before the Estate Officer under the P.P. Act and if grounds are available for judicial review of the process of decision making leading to the ultimate, decision of revocation or determination of the authority, a writ petition may be maintainable.

12. The view this Court has taken as above would find support from the principle of law which may be extracted from the decision of the Apex Court in Anamallai Club (supra). In that case, a licence was granted in respect of Government land to the appellant under the G.G. Act. The appellant remained in possession for a long time. However, all on a sudden, the licence was terminated by serving a notice under Section 3 of the G.G. Act and, simultaneously, the land was resumed and possession thereof was taken by the Government without giving any opportunity to the appellant and without following the procedure prescribed by the Tamilnadu Public Premises (Eviction of Unauthorised Occupants) Act, 1975. The writ petition was allowed by the learned single Judge of the High Court. However, the decision was upset in appeal. The Division Bench upheld the termination of licence and held that resumption of possession of land by the Government without taking recourse to the provision of the Tamilnadu Public Premises (Eviction of Unauthorised Occupants) Act was not necessary. Although, the Apex Court did not ultimately interfere since possession of the land had already been taken, it did not approve the manner in which such possession was taken. It was specifically observed in paragraph 9 as follows:

Unfortunately, on the facts of the case on hand, the respondent has not adopted the procedure prescribed under Sections 4 and 5 of the Eviction Act after determination of the licence granted under the Government Grants Act. The High Court, therefore, was not right in its conclusion that the procedure prescribed under the PPE Act is not applicable to the grants made under the Government Grants Act since the appellants remained in settled possession since a long time pursuant to the grant. After determination of the grant, though they have no right to remain in possession, the State cannot take unilateral possession without taking recourse to the procedure provided under the Act.

It was also ruled in paragraph 10 of the said decision as follows:

After termination of the licence by the Government under the Government Grants Act, the Estate Officer appointed under Section 3 cannot go into its correctness and adjudicate in the proceedings under Section 3 thereof. In our view, the Division Bench of the High Court is right in its finding. The Government having determined the licence, the Estate Officer cannot go into the question of legality of the termination of the licence under the Crown (Government) Grants Act to take further steps under Sections 4 and 5 of the Act.

(emphasis added)

13. Although it is true, as contended by Mr. Sanyal, that the licence there was governed by the G.G. Act which is not the case here, the materiality of the decision to the present controversy lies in this that the Apex Court had affirmed the finding of the Division Bench that the question regarding legality of termination of licence could not be gone into by the Estate Officer in proceedings under the concerned Public Premises Eviction Act (while taking steps in terms of Sections 4 and 5 thereof) and that is what applies with full force in the present case. Correctness and/or propriety of a decision to determine a lease cannot therefore be an issue for adjudication and be tried by an Estate Officer under the P.P. Act. This Court is not at all impressed with Mr. Sanyal's contention that the decision in Anamallai Club (supra) would have no application in the facts of the present case.

14. Albeit in a different fact situation, a learned single Judge of this Court in Lee and Muihead (supra) held that if the action of the lessor in terminating a lease patently fouls Article 14 of the Constitution, such an issue cannot be tried by the authority under the P.P. Act or before any Civil Court and the point has to be raised before a Court competent to pronounce upon constitutional issues and before no other authority, and that if the notice to quit perishes on the ground of constitutional invalidity, the Estate Officer under the P.P. Act has no authority to initiate proceedings for eviction. That would be similar to an eviction suit or a complaint being incompetent in the absence of a notice terminating the tenancy. That was a decision against the same Port Trust and nothing has been placed before this Court to suggest that the same has been upset in appeal. The reasoning given therein applies with full force here and this Court, while clearly agreeing with the view expressed in the aforesaid decision, would hold that the notice to quit does not meet the constitutional requirement of fairness and reasonableness in 'State' action and the action of the Port Trust determining the lease on the ground of alleged breach without granting opportunity to the petitioners to meet the allegations renders the impugned notice vulnerable and liable to invalidation.

15. The decisions cited by Mr. Sanyal are now taken up for consideration. Strong reliance has been placed by Mr. Sanyal on Jiwan Dass (supra). According to him, challenge therein to the action of the owner of the public premises on the ground of unreasonableness and violation of Article 14 of the Constitution of India was held to be without force. It appears from the cited decision that a notice under Section 106 of the T.P. Act was issued by the owner determining the tenancy which was called in question in a writ petition. The Apex Court held that Section 106 of the T.P. Act does not contemplate giving any reason for terminating the tenancy and, therefore, reading into it reasonable and justifiable grounds for initiating action for terminating the tenancy would render provisions of Section 106 of the T.P. Act and Section 2(g) of the P.P. Act ultra vires.

16. In the present case, the notice to quit is not under Section 106 of the T.P. Act but as submitted by Mr. Sanyal, one in terms of Section 111(g) thereof. Recourse to Section 111(g) of the T.P. Act may be had in case the lessee breaks an express condition of the lease and on breach whereof, there would be a determination of lease by forfeiture. Here, the terms and conditions of the lease are enumerated in the written lease deed. It specifies the period during which the lease shall be operative with option for its renewal. It also enumerates the 'do's' and 'don'ts' and the situations on the occurrence of which the lease may be determined. The lease has been determined prior to its expiry on the ground of breach of the terms and conditions. Whether there has been a breach of the terms and conditions of the lease is purely a question of fact and, therefore, must be based on objective consideration. Such objective consideration, in appropriate cases, is justiciable. Once lease of public premises has been determined and a notice to quit it is issued, and the period to quit and vacate possession thereof has expired, the bar to approach a Civil Court would come into operation in terms of the P.P. Act. If a lease has been unilaterally determined by an Article 12 authority on alleged non-existent grounds and consequently the lessee feels aggrieved thereby, can he be left without a remedy? In the present case the petitioners have claimed that in terms of the lease deed, sub-tenants had been inducted with the permission of the Port Trust while it appears from the counter-affidavit filed by the Port Trust that not all sub-tenants have been inducted with its permission and, therefore, the consequent determination of the lease. Therefore, according to the Port Trust, there was a reason for determining the lease. If the action of the lessor in such case is challenged in a writ petition on allegations of arbitrary, unreasonable and high-handed 'State' action constituting violation of fundamental and/or other rights and a strong case on merits is made out for exercise of writ powers, the Court of Writ in an appropriate case may be justified in interfering with the impugned 'State' action. Such a case cannot be equated with a case under Section 106 of the T.P. Act with which the Apex Court was dealing with in Jiwan Dass (supra) where the jurisdictional fact was entirely different.

17. It is settled law that the rule deducible from the application of law to the facts and circumstances of a case constitutes its ratio decidendi and not some conclusion based upon facts which may appear to be similar, and that one additional or different fact can make a world of difference between conclusions in two cases even when the same principles are applied in each case to similar facts (see: AIR 1976 SC : The Regional Manager v. Pawan Kumar Dubey). In : The State Financial Corporation v. Jagdamha Oil Mills, it has been held that Courts should not place reliance on a decision without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. In the considered view of this Court, the decision in Jiwan Dass (supra) is clearly distinguishable and the principle of law laid down therein has no applicability on facts and in the circumstances of this case.

18. On the contrary, the principles of law that can be extracted from the decisions in Anamallai Club (supra) and Lee and Muihead (supra) have applicability in the present-factual scenario and accordingly this Court has applied the law laid down therein for deciding Issue No. 1 (supra). The decision in Harmony House (supra) is an authority for the proposition that once notice under Section 4 of the P.P. Act has been issued by the Estate Officer, whether or not the materials on the basis of which opinion is formed is sufficient is not justiciable at the notice stage and it would be proper for the Court of Writ not to interfere but to grant opportunity to the aggrieved litigant to raise all points, factual and legal, before the Estate Officer in whom the legislature has vested the authority to determine whether on the basis of the materials placed before him an order of eviction should be made or not. The point with which this Court is concerned did not arise in the case of Harmony House (supra) and, therefore, the said decision cannot be of any assistance to the respondents.

19. The decision in Ashoka Marketing (supra) was noticed in the aforesaid decisions. This Court has not found any principle of law laid down therein which is applicable in the present case. The decision in Ashoka Marketing (supra) also does not assist the respondents.

The issue is, therefore, answered in the negative.

Issue No. 2

20. In Jamshed Hormusji Wadia (supra), the manner in which a body within the definition of State under Article 12 would be governed by Article 14 in all its actions, even in the field of contracts, has been detailed. One of the issues which fell for determination was the status of Bombay Port Trust as a landlord and whether it was obliged to act in a fair and reasonable manner in the matter of dealing with its lessees and charging rent from them.

Extracts from the said decision, relevant for the present dispute, read thus:

14. The Bombay Port Trust is an instrumentality of State and hence an 'authority' within the meaning of Article 12 of the Constitution, (see: Dwarkadas Marfatia and Sons v. Board of Trustees of the Port of Bombay . It is amenable to writ jurisdiction of the Court. This position of law has not been disputed by either party.The consequence which follows is that in all its actions, it must be governed by Article 14 of the Constitution. It cannot afford to act with arbitrariness or capriciousness. It must act within the four corners of the statute which has created and governs it. All its actions must be for the public good, achieving the objects for which it exists, and accompanied by reason and not whim or caprice.

16. The position of law is settled that the State and its authorities including instrumentalities of States have to be just, fair and reasonable in all their activities including those in the field of contracts. Even while playing the role of a landlord or a tenant, the State and its authorities remain so and cannot be heard or seen causing displeasure or discomfort to Article 14 of the Constitution of India.

18. In our opinion, in the field of contracts the State and its instrumentalities ought to so design their activities as would ensure fair competition and non-discrimination. They can augment their resources but the object should be to serve the public cause and to do public good by resorting to fair and reasonable methods. The State and its instrumentalities, as the landlords, have the liberty of revising the rates of rent so as to compensate them selves against loss caused by inflationary tendencies. They can - and rather must - also save themselves from negative balances caused by the cost of maintenance, and payment of taxes and costs of administration. The State, as landlord, need not necessarily be a benevolent and good charitable Samaritan. The felt need for expanding or stimulating its own activities or other activities in the public interest having once arisen the State need not hold its hands from seeking eviction of its lessees. However, the State cannot be seen to be indulging in rack renting, profiteering and indulging in whimsical or unreasonable evictions or bargains.

19. A balance has to be struck between the two extremes. Having been exempted from the operation of rent control legislation the Courts cannot hold them tied to the same shackles from which the State and its instrumentalities have been freed by the legislature in their wisdom and thereby requiring them to be ruled indirectly or by analogy by the same law from which they are exempt. Otherwise, it would tantamount to defeating the exemption clause consciously enacted by the Legislature. At the same time the liberty given to the State and its instrumentalities by the statute enacted under the Constitution does not exempt them from honouring the Constitution itself. They continue to be ruled by Article 14. The validity of their actions in the field of landlord-tenant relationship is available to be tested not under the rent control legislation but under the Constitution. The rent control legislations are temporary, if not seasonal; the Constitution is permanent and all time law.

(emphasis added)

21. The requirement of complying with natural justice in situations involving civil consequences when such requirement is neither expressly excluded nor excluded by necessary implication has been emphasized in Rajesh Kumar (supra). In the decisions of the Apex Court reported in : Binapani Devi v. State of Orissa and : Union of India v. K.P. Joseph, obligation to comply with natural justice while passing administrative orders involving curtailment of rights has been authoritatively pronounced.

22. From a conspectus of the authorities referred to above, the conclusion is irresistible that the Port Trust cannot act like a private landlord and determine the lease on grounds mentioned in Section 111(g) of the T.P. Act without complying with the principles of natural justice, i.e. an opportunity to meet the allegations. In ordinary cases of landlord-tenant dispute, the very basis of determination of lease can be challenged before a Civil Court for examining the existence of the grounds forming such basis and for a decision in respect thereof. This cannot be had in a proceeding before the Estate Officer under the P.P. Act. Occupation of the concerned public premises by the petitioners which was so far considered legal, after expiry of the period to quit and deliver vacant possession mentioned in the impugned notice would become unauthorised. When the allegation of breach of terms and conditions is disputed by the lessee, a decision in this behalf ought to be taken consistent with principles of natural justice. That would postulate an opportunity to defend before one is condemned for committing breach, which admittedly has not been extended in the present case and, therefore, in a case where the Port Trust considers it necessary to determine a lease for alleged breach thereof, an opportunity to the lessee to counter the allegation (s) has to be conceded to bring its action in conformity with the requirement of Article 14 of the Constitution. The impugned notice visits the petitioner with civil consequences and hence the writ petition cannot be said to be not maintainable on the ground that it is premature, as contended by Mr. Sanyal.

23. Submission of Mr. Sanyal that no point has been taken in the petition regarding non-compliance with principles of natural justice prior to issuance of the notice to quit has failed to impress this Court, for, on a reading of the entire petition and in particular Ground No. VII thereof, it is clear that the petitioners have alleged violation of principles of natural justice, and, that they were not heard in respect of the allegations contained in the impugned notice stands admitted. Ground No. IV of the petition cannot be read in isolation for dismissing the writ petition. It is, therefore, declared that the action of the Port Trust in unilaterally determining the leased on the ground that the petitioners have committed breach thereof without granting opportunity of defence to them fouls Article 14 of the Constitution of India and, therefore, is unsustainable in law.

Issue No. 2 is decided accordingly.

Issue No. 3

24. Now comes the question of relief. On the basis of the discussion as above, the impugned notice to quit cannot sustain in the eye of law. Accordingly, it stands set aside. It shall, however, be open to the Port Trust to proceed against the petitioners according to law.

25. The writ petition succeeds to the extent mentioned above.

There shall be no order as to costs.

Urgent photostat certified copy of this Judgment, if applied for, be furnished to the applicant within 3 days from date of putting in requisites therefor.


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